Pay uk vat to enjoy all benefits provided by this taxation system

If you’re a trader in the UK with rising taxable sales then you need to pay uk vat to relish all benefits provided by this taxation system. As soon as your taxable sales touch the vat threshold limit of ?70,000 in the past vat numbers 12 months then you’ll need to apply for vat registration in order that you can also become part of this tax system that is in force in most Europe.

If you are a really small trader that mostly sells retail goods you’ll be able to remain out of the purview of vat or value added tax as long as your taxable sales do not touch ?70,000 in Twelve months. However, in case your sales touch that figure or if you sell goods to vat registered traders then you would be better off as a vat registered trader in the UK. Vat continues to be employed as a means of collecting taxes on goods and services in most of Europe and the UK too follows this system. The vat department in the UK is headed by HM Revenue and Customs or hmrc department.

Once you have crossed over the vat threshold limit for uk then you’ll need to make an application for vat registration. You can do so even before you reach this limit if you think that you need to reclaim vat that has already been paid on services and goods, specifically in a different eu country where this system is followed. You should hire the services of an experienced vat agent well conversed in uk and eu vat rules for vat registration purposes as well as for filing of vat refunds so that there are no problems in claiming back vat.

As soon as you do turn into a vat registered trader in the United Kingdom, which could take up to 30 days once you file a web-based vat application then you will need to charge vat according to the 14,000 goods and services classifications provided by the hmrc vat department. This will likely need to be done through each vat invoice you will be needed to issue during each taxable sale. UK has 3 vat rates beginning with the standard rate of 17.5%, reduced vat rate of 5%, as well as the zero vat rate. Certain goods and services are totally vat exempt too.

Once you are a vat registered trader in order to pay and collect uk vat determined by vat invoices then you’ll also have to file your vat returns regularly. Again, your vat agent is going to be necessary to calculate vat to be paid or refunded depending on your vat purchases and sales. If you have imported goods or services in the UK after paying vat in a eu country then you can avoid double taxation by filing a vat reclaim form. You will be awarded vat refund between four to 8 months after your claim is successfully processed by hmrc and the member country. Overall, vat is a good tax system to prevent double taxation as well as plug many loopholes which were found in the traditional sales tax system.

If you’re a growing trader in the UK that sells taxable goods to vat registered traders then you will want to maintain the cycle of vat alive by getting to be a vat registered trader. You can now collect and pay uk vat while also claiming any vat previously paid on imported products or services, which will will reduce your tax overheads to a large extent.